You Have a Portfolio Consisting Solely of Stock a and Stock

question 22

Multiple Choice

You have a portfolio consisting solely of stock A and stock B. The portfolio has an expected return of 8.7 percent. Stock A has an expected return of 11.4 percent while stock B is expected to return 6.4 percent. What is the portfolio weight of stock A?

• A) 39 percent
• B) 46 percent
• C) 54 percent
• D) 61 percent
• E) 67 percent

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Definitions:

Arteriovenous Anastomosis

Vessel through which blood is shunted from an arteriole to a venule without passing through the capillaries.

Arteriole

A small artery that leads into capillaries, controlling blood flow and pressure by the contraction and relaxation of its muscular wall.

Venule

Small blood vessels that allow deoxygenated blood to return from capillary beds to larger blood vessels called veins.

Arteries

Blood vessels that carry oxygen-rich blood away from the heart to the body.